In recent years, the rise of fintech and online lending platforms (OLPs) in the Philippines has been accompanied by a surge in reports regarding aggressive and abusive collection practices. While debt collection is a legitimate business activity, the methods employed by some agents often cross the line into criminal behavior.
If you are facing relentless calls, public shaming, or threats from lending agents, the Philippine legal system provides several avenues for protection and redress.
1. Defining the Offenses
Unjust Vexation
Under Article 287 of the Revised Penal Code (RPC), as amended by Republic Act No. 10951, unjust vexation is a catch-all provision for any human conduct that, although not causing physical harm, unjustly annoys, irritates, or vexes an innocent person.
In the context of lending, this includes:
- Incessant calling at midnight or early dawn.
- Contacting people in your phone's contact list who are not co-makers or guarantors.
- Using profane or insulting language during collection calls.
Harassment and Unfair Collection Practices
The Securities and Exchange Commission (SEC), through Memorandum Circular No. 18, Series of 2019, specifically prohibits unfair debt collection practices. Prohibited acts include:
- The use or threat of violence or other criminal means to harm the physical person, reputation, or property of any person.
- The use of obscenity or insults.
- Public Disclosure: Posting the names of debtors on social media or informing their employers/colleagues about the debt.
- False Representation: Claiming to be a lawyer, court official, or police officer to intimidate the borrower.
2. Violation of the Data Privacy Act (R.A. 10173)
Many lending apps gain access to a borrower’s contact list, gallery, and social media accounts as a condition for the loan. Using this data to harass the borrower or their contacts is a violation of the Data Privacy Act of 2012.
- Unauthorized Processing: Accessing phone data for purposes other than credit scoring.
- Malicious Disclosure: Sharing sensitive personal information to shame the borrower.
The National Privacy Commission (NPC) has the authority to order the permanent shutdown of apps found violating these privacy rights.
3. Cyberlibel and the Cybercrime Prevention Act
If an agent posts your photo or personal details on Facebook or other public forums with the intent to defame or shame you for an unpaid debt, they may be liable for Cyberlibel under Republic Act No. 10175.
Unlike traditional libel, cyberlibel carries a higher penalty because the use of information technology allows the defamatory content to spread more rapidly and reach a wider audience.
4. Remedial Steps: What You Can Do
If you are a victim of these practices, you should take the following steps to build your case:
| Action | Description |
|---|---|
| Document Evidence | Take screenshots of text messages, social media posts, and call logs. Record phone calls if possible (keeping in mind the Anti-Wiretapping Law, though calls used for harassment are often admissible in criminal complaints). |
| File an SEC Complaint | Submit a formal complaint to the SEC’s Corporate Governance and Finance Department. They can fine, suspend, or revoke the license of the lending company. |
| Report to the NPC | If your private data was leaked or used to message your contacts, file a "Complaints and Investigation" report with the National Privacy Commission. |
| Police Assistance | Visit the PNP Anti-Cybercrime Group (ACG) or the NBI Cybercrime Division to file a criminal complaint for Cyberlibel or Grave Threats. |
5. Important Legal Realities
- Debt is Civil, Harassment is Criminal: In the Philippines, no one can be imprisoned for non-payment of a basic debt (Article III, Section 20 of the Constitution). However, the manner in which that debt is collected can lead to the imprisonment of the collector.
- Corporate Liability: Under the "Doctrine of Vicarious Liability," the lending company itself can be held liable for the actions of its third-party collection agencies if it is proven they authorized or tolerated the harassment.
Note: Being a debtor does not strip you of your human dignity or your right to privacy. Legal remedies exist to ensure that while creditors have the right to collect, they must do so within the bounds of law and professional ethics.